A popular view of models among economists and philosophers alike is that all models are false, but some are useful. Models are frequently treated as convenient fictions, idealizations, stories about credible worlds, or "near enough" to the truth. But such a understandings pose serious questions,...

Adaptive learning under constant-gain allows persistent deviations of beliefs from equilibrium so as to more realistically reflect agents' attempt of tracking the continuous evolution of the economy. A characterization of these beliefs is therefore paramount to a proper understanding of the role...

A large share of global trade being priced and invoiced primarily in US dollar rather than the exporter's or the importer's currency has important implications for the transmission of shocks. We introduce this "dominant currency pricing" (DCP) into ECB-Global, the ECB's macroeconomic model for...

Most authors give, in the beginning of their elementary textbook, a warning to readers against confusion between movements on versus shifts of the demand and supply curves. Oddly, later on in the same book they themselves fall in the very trap of such confusion. The so-called Giffen good and...

In the context of the massive influx of Forcibly Displaced Myanmar Nationals to Bangladesh, this paper aims to evaluate the potential consequences on the Southern Bangladesh economy. It adopts an economywide perspective to study the impacts of increased labor supply and increased consumer demand...

This paper characterizes a general class of macroeconomic models with incomplete information, when the information process includes endogenous variables. I derive conditions for existence and uniqueness of equilibrium, which apply even when the model contains endogenous state variables, and I...

The paper provides a short account of the major complete macroeconometric models that have been constructed in Australia. Initially these were by academics but later both the Treasury and Reserve Bank of Australia developed these for policy analysis and forecasting, so that the history focuses a...

Representative models of the macroeconomy (RMs), such as DSGE models, frequently contain unobserved variables. A finite-order VAR representation in the observed variables may not exist, and therefore the impulse responses of the RMs and SVAR models may differ. We demonstrate this divergence...

Implications of partial information for applied macroeconomic modelling along four dimensions are shown, and analysis provided on how they can be addressed. First, when permanent shocks are present a Vector Error-Correction Model including latent, as well as observed, variables is required to...